Editor’s note: This is part of a series of blogs about the data economy. Specifically, how Data Economy Leaders are tackling the organizational and cultural shifts to align people, process, and technology with their business strategy to become a data-first business.
The catalyst of innovation and transformation is data. The companies that recognize the power of data and wield it to drive business transformation are seeing positive impacts on their business outcomes, as indicated in our report, How to Win in the Data Economy. We surveyed 1,000 senior business and technology executives to gauge the impact the data industry is having on their businesses, and to what extent companies are embracing the opportunity to become data leaders.
First, what is the data economy? The data economy represents the global supply and demand for live data, data applications, and data services. Data Economy Leaders are those who have moved beyond the critical first steps of breaking down silos and being able to share data—even live data—so that business users in all facets of the company can dynamically adjust their decisions based on aggregated data in near real time. The frontline of the data economy pack has done a lot of that seminal work and are now moving into next-level actions, such as using live data to begin to inform the evaluation of new markets, guide product strategy, and develop pricing models.
The integration of digital technology into all areas of business has shifted how companies operate and deliver value to their customers, especially over the last decade, and we’ve seen some new faces and roles in the C-suite to bridge that change: among them the CIO, the CISO, and the CRO (Chief Revenue Officer). With more companies recognizing the value of data to their products and services, it’s no surprise we’re now seeing the rise of the CDO (Chief Data Officer). Nearly half of the companies we surveyed had someone in this position, and it’s likely we will see more in the coming years as the data economy matures and people come to understand the revenue opportunities in data applications and services.
How to Win in the Data Economy investigates how companies are leveraging data today, where they struggle, what opportunity data provides, and how data can and should be used to empower the business, people, products, and optimal customer experiences. In addition to our late 2021 survey of senior business and technology executives, the study also includes influencers, analysts, and authors to really get a pulse on the attributes of a Data Economy Leader. We unveiled the highlights of that report in this blog post, and today begin a series of deeper dives into trends highlighted by the research.
The Data Economy Leaders are beginning to see real impact to their bottom line, their customer experiences, and even their product strategies and pricing models. In other words, they are evolving into a data-forward culture where collaboration is beginning to change the conversations people can have across departments, subsidiaries, partners, supply lines, and customers. To lead that charge, more companies are designating a Chief Data Officer as a fulcrum for bringing the People, Process, and Technology triad to bear on their data initiatives.
As companies come to see the ever-growing potential in the data economy, those companies considered Date Economy Leaders are designating a C-level person to deliver on the vision. Nearly half (48%) of companies surveyed have a C-level role responsible for delivering a data-first strategy. Well over half (60%) report that their companies have a fully developed and articulated data strategy. The “people” part of the people, process, and technology triad is filling out in real time, and based on the survey, we can only anticipate more roles and hiring trends to support the cause.
The research shows that today, the top use cases for the data economy are to identify risk and prevent fraud (42% of respondents), and to support the launch of new revenue or pricing models (41%). These are closely followed by discovering new market opportunities and personalizing customer service or the customer journey (40% and 38% respectively). All this points to a compelling observation: the Data Economy Leaders recognize the value of data to directly impact their bottom lines and are actively on a journey to having data shape their products’ target audiences, markets, and pricing.
So who’s at work here—the CMO? The chief revenue officer (CRO)? Head of product development or engineering? While they’re all involved, the data economy paved the way for the latest C-suite addition mentioned above, the Chief Data Officer (CDO). The appointment of a CDO is increasingly becoming a hallmark of data economy leadership.
Their role should encompass more than data management, data governance, and managing multi-cloud computing environments. The CDOs enabling their companies to be the Data Economy Leaders bridge the gap between data and business enablement. When data can begin to power product development, influence time-to-market, and more, that’s when a CDO is driving business transformation.
How? Technology and data democratization across the enterprise, with data literacy training for all. Rapid, universal access to data no matter where data or users reside; and seamless data collaboration across the enterprise, with any business partner, and data service providers, locally and globally.
Our research showed that Data Economy Leaders were better able to share live data, data services, and data applications across their ecosystems. Driven by a data infrastructure that respondents described as “scalable, elastic, and agile,” they could deliver data insights more quickly. And, with the lack of constraints, Data Economy Leaders are able to leverage greater amounts of data in their different formats, to drive historical, predictive, and prescriptive analytics.
The well-known maxim “knowledge is power” can be modified here to say, “If unsiloed data informs your knowledge, your power lies in being able to apply it tangibly, visibly, and measurably to the business.” And this pays in dividends—more than three quarters of Data Economy Leaders experienced positive annual revenue growth over the past three years. To be a Data Economy Leader, an organization must disseminate, as widely as possible, the most effective approaches to data sharing—across departments, subsidiaries, and geographical boundaries.
There was a time when many companies (and government entities) issued the call to their management teams to embrace “cloud-first.” Then we had “cloud-native,” and those companies who never had legacy infrastructure or business practices that tied them to hardware disrupted those that did. The cloud journey has evolved a lot, but are we starting to see “data-first” journeys? We think so.
Today we may recognize these Data Economy Leaders as the vanguard of the data economy. But the influencers we spoke to—analysts, authors, and company leaders—all agreed that the day is not that far off when we don’t call it the data economy. It will just be how business is done, with those companies that embraced data-driven, collaborative business practices in leadership positions, and the rest using legacy practices to get along as best they can.
To see what some Snowflake customers say about the role of the CDO and the power of data collaboration, see the full report here.